Month: April 2016

PhRMA’s official statement is now available on its website (though in the USTR’s press release, it finds no voice). On India’s IP regime, keeping up to its banality, it states –

India’s barriers to U.S. trade and investment, including its failure to respect intellectual property rights, continue to harm biopharmaceutical innovators and many other industries across the United States and around the world. While biopharmaceutical innovators saw potentially positive signs from the Indian Government in 2015, translating these positive statements into concrete progress has remained a challenge. PhRMA members welcome USTR’s decision to maintain India on the Priority Watch List and the emphasis the Special 301 Report places on achieving substantive and measurable results. Sustained engagement is essential to promote meaningful reform of India’s patent laws and policies.

In a series of posts, I’ll do a section wise analysis of India’s designation under the Report. I’m particularly keen to see how far PhRMA’s comments to the 2016 Special 301 were taken into account by USTR. Though, its no secret that USTR is the mouth – piece of the Washingtonian lobbyists.

Not to anyone’s surprise, India is on the Priority Watch List with the USTR retaining an option of conducting an Out- Of- Cycle Review (OCR). OCR depending upon either positive or negative developments warranting a review prior to the annual cycle. Basically, much would depend on India’s National IPR Policy, which by now should have been released. (Well beyond the “fortnight” timeline, I wonder behind which veil is the Policy shrouding!)

In the press release, the usual industry representatives (RIAA, MPAA and ETA) have voiced the importance of IP to American innovation ecosystem. Though, the deafening silence by PhRMA in the press release is somewhat surprising.

Skimming through the Report, I’m awestruck with India figuring in the list of ” Best IPR Practices by Trading Partners” (Page 10 of the Report). It finds mention in the sub- section on “predictability, transparency, and meaningful engagement between governments and stakeholders.” Exemplifying on this parameter, the Report states –

USTR supports predictability, transparency, and meaningful engagement between governments and stakeholders in the development of national laws, regulations, procedures, and other measures. Stakeholders report that such transparency and participation allow governments to avoid unintended consequences and facilitate stakeholder compliance with legislative and regulatory changes. For example, in late 2015, India issued a draft for public comment of proposed amendments to India’s Patents Rules and held hearings with interested stakeholders. USTR encourages continued, meaningful engagement with interested stakeholders as India continues to develop these and other IPR-related laws and regulations.

Lauding the robust bilateral engagement between the two countries on vital IPR issues, concerns over the following issues (rather rhetoric) have been expressed – (Country wise report on India runs from page number 38 to 45)

Proposed amendments to the Patent Rules.

Unpredictability in application of S. 3(d) of the Indian Patent Act, 1970.

Opaque procedure for soliciting comments for issuance of guidelines on the patentability of computer-related inventions.

Patent related challenges to the pharmaceutical industry – (i) Unpredictability and irregularity in the application of Section 3(d) of Indian Patents Act (ii) Lack of effective protection against unfair commercial use (iii) Ambiguous standards for issuance of compulsory licenses under S. 85 and 92 of the Indian Patent Act (iv) Lack of effective notification system for marketing approvals for generics.

High levels of piracy and counterfeiting.

Absence of legislative protection for trade secrets.

Non – ratification to major international IPR treaties such as the WCT, the WPPT, and the Singapore Treaty.

Priority to these issues shall be revitalized by entering into a dialogue with the IP Working Group. For the benefit of readers, the IP Working Group (formally known as the High Level Working Group on Intellectual Property) was established by President Obama and Prime Minister Modi.

In a series of posts, I’ll do a section wise review of India’s designation under the Report.

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From my abode of a year and a half (Gelman Library’s top floor), I wish all readers a very happy world book and copyright day! Not only are books a man’s closest companion but as Shakespeare puts it, “a force to counter the common curse of mankind – folly and ignorance“. The World Book and Copyright Day is celebrated by UNESCO to commemorate Shakespeare’s death anniversary and to promote the culture of reading, publishing and copyright.

This phrase, ” the culture of reading, publishing and copyright” poses an interesting quandary. The quandary being the jurisprudence of copyright protection. Between 1589 and 1613, when Shakespeare produced his seminal literary works, there was no form of copyright regulation in England. Nevertheless, the Bard of Avon was undeterred to pen his thoughts. It was only after many years of his death, that the first IP legislation – the Licensing of the Press Act, 1662 was enacted in England. Even then, it was only in 1710 with the passage of the Statute of Anne by the British Parliament that copyright protection was conferred to literary works. Hence, testifying that copyright was not necessarily an incentive for creative expression, for one of the greatest English writers flourished in absentia of a copyright regime.

Infact, just last night over dinner I was asked about the copyrightability of certain English works. My father’s dear friend – Mark Turner has a quaint hobby of collecting Regency charades (a form of rhyming riddles) and subsequently blogging about it. Due to their antiquity, locating original versions was not only difficult but extremely expensive. However, he was successful in procuring their reprints from various sources and is perhaps one of the handful owners in the world of such a Collection.

He asked me if he was violating copyright law, even though it was purely a non – commercial activity. Considering that these charades were written during the Regency period, which ran roughly from 1776 through the 1830’s, they were copyrightable subject matter under the Statute of Anne (which was enacted in 1710). He breathed a sigh of relief on being told by me that he need not worry. All these works had fallen into public domain and could be used without seeking permission of their authors. Another interesting thing about these riddles is that majority of them were penned under a pseudonym. Had these works not fallen into public domain, a bigger issue of orphan works had to be combated. (On a side note, try guessing some of these riddles. Apart from being fun, they’re a good exercise for the gray cells!)

On the World Copyright Day, I want to highlight this year’s two noteworthy copyright developments at the domestic and international front –

(i) The transfer of the Indian Copyright Office from the Ministry of Human Resources and Development to the Department of Industrial Policy and Promotion. I’ve written about this here.

(ii) A very critical time for the WIPO Broadcasters Treaty (The Treaty) : The 47th WIPO General Assembly ended in a political stalemate over several issues on the impeding WIPO Broadcasters Treaty. In the upcoming WIPO Standing Committee on Copyright and Related Rights (SCCR), if the national governments do not explicitly come out in support of the Treaty, it could spell doom and perhaps mark the end of a road map for an international legal framework for protection of broadcasting organizations.

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The recent announcement on the transfer of the Indian Copyright Office from the Ministry of Human Resources to the Department of Industrial Policy and Promotion has garnered mixed reaction from the relevant stakeholders.

One argument is that by consolidating all IP offices under one Government department would lead to better coordination and avoidance of clash of jurisdictions. The other side of the argument goes to the history of the Indian copyright law, indicating a close relationship between copyright law and India’s education policy.

Not delving into the merits of the arguments (though I’m personally in favour of consolidation considering copyright ‘s diverse industry base ranging from broadcasting to the software industry ), I want to highlight a plausible reason for this shift.(Since there has been no Government notification explaining the reasons for the transfer).

The U.S. – India Business Council (USIBC), a prominent U.S. business advocacy organization for cementing India – U.S. trade relations, had recommended for such a consolidation in its testimony to the USTR for the 2016 Special 301 held on March 31st, 2016. It stated –

We recommend that responsibility for the enforcement of the Copyright Act of 1947 and related international convention be consolidated and shifted to one department, like the Department of Industrial Policy and Promotion.

Hence, to me this decision by the Government seems like a bye – product of the ensuing negotiations going on between India and U.S. on former’s IPR Policy. It could also be India’s last ditch attempt for upgrading its status or an undertoning ahead of the 2016 Special 301 Report which is due for release somewhere around April 30th, 2016.

What deal was struck between the Government of India and the USIBC is for posterity to reveal. All I can say is that given the perfect timing, the USIBC’s recommendation and the Government of India’s decision cannot be mere coincidence.

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Today, I finally got the chance to review the testimonies made to the USTR for the 2016 Special 301. ( See here, here, herehere, here,and here on 2016 Special 301. On a side note, I’m still grappling with USTR’s unusual delay in uploading its transcript and video. As per Mr. Mehta, they should’ve been uploaded to USTR’s website within a fortnight).

In my previous post, I had analysed submissions made by various trade groups and not – for- profit organizations, on India’s IPR regime. Out of those, following testified at the public hearing – (please note that only submissions pertaining to India have been highlighted)

He opined that India had not made substantive and measurable improvements in its IPR regime. And hence, at a minimum, an Out – of – Cycle review was warranted.

Question raised by Christine Peterson of the USTR : How would he characterize the initiatives taken in the past 12 months by the Modi Government?

According to him, there were some positive developments. However, due to the broad sweep of its member companies, more was expected. Data exclusivity was a major area of concern.

Question raised by Jean Bonilla of the U.S. Department of State : What were his views on the Make in India initiative?

It was a general policy matter, which every country was free to decide. However, provision in the Draft National IPR Policy to give expedited review to patent applications filed by entities that committed to manufacturing in India was partial treatment.

Mark Lauroesch, Executive Director expressed concern over India’s requirement on the existence of a contractual relationship between the patent owner and the would-be misappropriator for bringing a misappropriation action.

Question raised by Michael Smith of the USPTO :How did the introduction of utility model protection (such as that proposed by India’s Draft National IPR Policy) increase litigation? (This was based on IPO’s written submission made to the USTR. The relevant excerpt from their submission is, “There is also a recommendation to add utility model protection to support the informal segment of India’s economy. Although there might be some benefits, this might also lead to increased litigation and uncertainty for innovators operating in India, as has been the case with a similar system in China. ” – Pg. 14).

He answered that with utility models, no examination was required. Because of this more questionable IP rights were formulated. and perhaps asserted. This lead to an increase in litigation.

(D)Knowledge Ecology International (KEI)

James Love, Director of KEI testified that based on his review of the submissions, many were focused on India. Couple of the submissions stated that India had agreed not to issue compulsory licenses by signing an agreement. If the U.S. Government was in possession of the agreement, it should be made public. They would definitely like to see it.

Question raised by Stevan Mitchell of the U.S. Department of Commerce : Based on ATFI’s submission there was inadequate protection for trade secrets in India. As the Subcommittee would analyse the adequacy and effectiveness of India’s trade secret laws, were there any principles or considerations that he suggested should be kept in mind?

He hoped that the USTR would not have an overly broad view of what constituted trade secret and that it would’nt discourage governments from mandating transparency.

(E) Pharmaceutical Research and Manufacturers of America (PhRMA)

Chris Moore, Deputy Vice President for International Policy at PhRMA expressed that restrictive patentability criteria (u/s 3 (d) of the Indian Patent Act, 1970) prevented introduction of new dosage forms and combinations that could promote adherence and lower overall health care costs by innovators and generics. Weak patent enforcement posed a serious problem. After additional duties and assessments, effective tariffs on medicines in India was as high as 20 %. All of this mandated India to be placed on Priority Watch List with an Out – Of- Cycle review.

Question raised by Maureen Pettis of the U.S. Department of Labour : What was the economic impact of restrictive patentability criteria on U.S. pharmaceutical industry?

He answered that the economic impact was difficult to quantify.

(F) Public Citizen

Burcu Kilic, Public Citizen’s Global Access to Medicines Program came out in support of India’s patentability criteria. She opined that S. 3(d) of Indian Patent Act, 1970 was structured as a subject matter eligibility threshold and not as a patentability test. Thus, was TRIPS compliant and should not be cited in the the Special 301 (on India’s TRIP’s -compliant interpretation of patentability criteria).

Further, she also came out in support of India’s stance on issuance of compulsory license for a cancer medicine. She said that issuance of CL complied with India’s patent law , which was narrower than TRIPS permissible limits.

Question raised by Mary Critharis of the USPTO : Public Citizen in its written submission had remarked with respect to India that countries should be given the flexibility to determine patentability standards. On this, she asked whether there were any situations in which a new form, a new formulation or a new structure could be given patent protection? Or did it believe that there should be a policy barring all such innovations.

Burcu Kilic answered that Indian patent law afforded due protection to new inventions. S.3 (d) of the Patent Act, 1970 was formulated as a test to determine whether the subject matter was a new invention. And if the subject matter was new use, it was subjected to the patentability by the Indian Patent Office. However, there was a major problem with these so – called inventions. They were mostly second-rate patents ( implying thereby that they were not new inventions).

(G) GLOBAL INTELLECTUAL PROPERTY CENTER

Patrick Kilbride, Executive Director for International IP remarked that he expected Indian Government to instill legal certainty in the marketplace. Threat of issuance of compulsory license and patentability of computer-related inventions were major areas of concern.

(H) U.S. – India Business Council (USIBC)

Mukesh Aghi, President of USIBC remarked that importantdevelopments related to India’s IP regime had taken place in the last 12 months. Some of them were (a) Frequent interaction between U.S. and Indian Government (b)Improved transparency and frequent dialogue with the industry. (c) Denial of compulsory licenses (d) Capacity building.

Following are some pertinent recommendations made by him – (a) Consultation with industry on the guidelines for the examination of patent application for computer-related inventions.(b) Consolidation of enforcement of the Copyright Act and related international convention (c) Issuing guidelines for interpretation of s. 3(d) of Patents Act, 1970.

Question raised by Won Chang of the U.S. Department of the Treasury : How was Make in India related to IP? Would it lead to intellectual property reforms?

Mukesh Aghi answered that for Make in India to be successful, a world class IP policy was imperative.

Question raised by Stevan Mitchell of the U.S. Department of Commerce : Did USIBC have a chance to review ATFI’s submissions (considering that both were Indian centric trade organizations)? And how were USIBC’s views different from ATFI’s?

He had not reviewed ATFI’s submissions but based on statistics its member companies were assured by the IP policy commitment made by the Indian Government.

CONCLUSION :

To my delectation (though it may be short lived), the testimonies by pro – industry trade groups were not as acerbic vis- a-vis India’s IPR regime. And as usual, Jamie’s outright testimony by tabling statistics tickled my funny bone.

As I neared the last testimony, the buoyancy of my mood turned into dejection. For, it came to my knowledge only today that Manon Ress of the Union for Affordable Cancer Treatment, an organization whose work I support in heart and spirit was a cancer patient since 2010 (May force be her to fight out the disease). In her testimony, she welcomed Indian Supreme Court’s rejection of the Bayer appeal on Nexavar’s compulsory license.

What needs to be seen is whether the release of the National IPR Policy coincides with the 2016 Special 301 Report. The National IPR Policy is up for Cabinet’s consideration while the 2016 Special 301 Report would be released somewhere around April 30, 2016.

Even if the National IPR Policy is unveiled before the release of 2016 Special 301, it would not have any effect on India’s status. However, if the Policy appeals to U.S. trade organizations, its status could potentially be upgraded in the 2017 Special 301.

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The harbinger of India’s IPR Policy is the latest to be mired in a plagiarism row. Allegations have been levied against the Department of Industrial Policy and Promotion for plagiarizing several portions in the recently released consultative paper on Standard Essential Patents.

I did’nt have the chance to dig deeply into the paper (being swamped with my own research paper! ). If true, this is reflective of a very disturbing trend. Coming up with something original is arduous but giving credit not so much.

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The wait is finally over! The transcript and the video of the 2016 Special 301 public hearing is now available. With deluge of professional commitments, I’ll be able to bring my thoughts on it only after April 15th. Hence, kindly bear with it. ( For previous posts on the Special 301, see here,here, here , here and here).

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The Agenda for the WIPO’s International Conference on Intellectual Property and Development being held on April 7th and 8th has been released. The Conference will also be live webcasted. Needless, to say I’ll be coming up with my thoughts on the Conference.

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Apologies for the delay in informing but if rumors are to be believed, the National IPR Policy is about to be released anytime soon. Further, the DIPP has stated that the Policy shall widen the ambit of copyright.

With a month since the public hearing to the 2016 Special 301 took place at the USTR, there is no sight of its recording and transcript. Hence, epitomizing a tale of endless numbered days for people keenly following developments at that front.

The Federal Register states, ” USTR also will post the transcript and recording of the hearing on the USTR website as soon after the hearing as possible.” What is holding back USTR to upload an already recorded public hearing is incomprehensible to me. Jotting down the transcript also does not seem like an arduous task.

Nevertheless, I’m increasingly losing my patience and now only eyeing the final release of the 2016 Special 301 Report ( which by the way is due for release in the next 28 days or so).

Enough of ranting at this front! In an attempt to gain some leads on where the 2016 Special 301 was headed, I stumbled upon this blogpost written by Hugh Stephens, former Senior Vice President (Public Policy for Asia – Pacific region) at Time Warner’s Hong Kong office.

In this erudite post, he argues how some of the organizations were trying to subvert the mandate of the Special 301 Process. Ignorant of this fact until couple of days back, according to Stephens, the Congress’s original intent for devising the Special 301 was to address copyright infringement even though it covered all the primary areas of IP . (Considering U.S.’s constant rhetoric on pharmaceutical patents, I’ve always been under the impression that between patents and copyright, U.S’s primary area of concern was the former. Next on my bucket list is to research on the legislative history of the Special 301.)

CompTIA and CCIA disapproving the policy of “ancillary copyright” – which though branded as an extension of existing IP law, was inconsistent with international IP norms . As per these organizations, this served as a market access barrier being violative of international commitment to quotation. ( Ancillary copyright is better addressed as “quotation levies” or a “snippet tax“. Read page number 2 of CCIA’s Submission)

IA stressing upon the role of copyright limitations and exceptions for U.S. internet companies to access foreign markets. Alibaba Group reported and provided supplemental information to its submissions on ” 2015 Notorious Markets” for the 2015 Special 301 Out-of-Cycle Review of Notorious Markets .

Following statement by Professor Sean Flynn adds weight to Stephens argument that the Congress intended the Special 301 to strengthen IPR protection and “not as a means to roll back protection by broadening exceptions and limitations.”

The Special 301 program takes its name from, and builds upon the administrative structure of, Section 301 of the Trade Act of 1974. That Act was passed at a time of large and growing trade deficits, increasing flight of manufacturing activities abroad, the rise of Japan as an industrial giant, skyrocketing foreign debt and economic crises caused by dependency on foreign oil imports, all of which fueled a mood in U.S. policy circles that was “decidedly protectionist”.

Stephen’s argument that this supposedly “hijacking” of the Special 301 should be a cause for alarm would perhaps resonate well with the International Intellectual Property Alliance and other D.C. based organizations who strongly propagate for stringent copyright protection. However, not being overtly protectionist, I’m of the view that the entire Special 301 process is dominated by the “rights holders“, with no voice for ” copyright – liberals“. Whether the USTR through the aegis of the Special 301 process is an appropriate forum is an altogether different question?

Time only will tell whether the USTR would deviate from its original mandate and transgress into the field of ” loosening of copyright norms“.

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